KENYA

Ethiopia clears hurdle for M-Pesa expansion

Ethiopian authorities told Business Daily on Thursday that the Safaricom licence will be upgraded to include mobile financial service.

A consortium led by Safaricom secured the first licence, which does not have a permit for mobile financial services like M-Pesa, in May.

Ethiopia has cleared the way for Safaricom to introduce its popular M-Pesa in the market of 110 million people after deciding to include the mobile phone-based financial services in the telco’s licence offered in May.

Ethiopian authorities told Business Daily Thursday that the Safaricom licence will be upgraded to include mobile financial service when it completes bidding for its second telecoms operator permit.

A consortium led by Safaricom secured the first licence, which does not have a permit for mobile financial services like M-Pesa, in May.

The consortium will start operations next year when Ethiopian authorities say the telco will have the right to operate mobile financial services.

This marks a departure from last year’s directive that only allowed locally owned non-financial institutions to offer mobile money service, dimming the hopes of foreign firms like Safaricom that are seeking a presence in Kenya’s neighbouring country.

Source: Business Daily

Capital boost for banks giving loans for homes

The Central Bank of Kenya (CBK) has been requiring banks to maintain capital that is at least half the value of the mortgage book but has now cut this to 35 percent.

The changes, which took effect on July 1, effectively mean that banks can now lend more towards homeownership at the current capital levels.

The CBK director for bank supervision Gerald Nyaoma has sent a circular to all lenders, instructing them to effect the changes.

Banks will now have additional money for lending towards home ownership after the regulator lowered the capital required to back mortgages.

The Central Bank of Kenya (CBK) has been requiring banks to maintain capital that is at least half the value of the mortgage book but has now cut this to 35 percent.

The changes, which took effect on July 1, effectively mean that banks can now lend more towards homeownership at the current capital levels.

CBK says the changes are expected to encourage banks to give out more mortgages in a market that has added 10,836 mortgage loans in 10 years yet annual demand for housing units is estimated at 200,000.

The CBK director for bank supervision Gerald Nyaoma has sent a circular to all lenders, instructing them to effect the changes.

“CBK has decided to review the capital adequacy risk weighting for all residential mortgages from the current risk weight of 50 t0 35 percent. It is envisaged that this amendment will free capital for banks to increase their mortgage lending,” said Mr Nyaoma.

The changes, added to last September’s licensing and operationalisation of the Kenya Mortgage Refinance Company (KMRC), are expected to offer a boost to the mortgage market.

KMRC is expected to lift uptake of domestic residential mortgages by offering long-term loans to primary mortgage lenders including commercial banks, microfinance banks and savings and credit co-operatives.

CBK data showed the value of mortgage loans outstanding was Sh232.7 billion in December last year compared to Sh237.7 billion in the previous year, cut by repayments and lower new loans in Covid-19 environment.

Source: Business Daily Africa

EPZA set to get substantive chief executive after three years

Mr Otieno emerged top, beating two other shortlisted contenders, Orumoi Jonah and Adan Noor in the interview held on Tuesday last week.

The agency board has struggled to recruit a CEO since Cabinet Secretary Peter Munya removed Fanuel Odede Kideda as the EPZ chief executive in September 2018.

The board of the Export Processing Zones Authority (EPZA) has proposed the appointment of Ezekiel Owuor Otieno as the new CEO after nearly three years without a substantive head.

Mr Otieno emerged top, beating two other shortlisted contenders, Orumoi Jonah and Adan Noor in the interview held on Tuesday last week.

The agency board has struggled to recruit a CEO since Cabinet Secretary Peter Munya axed Fanuel Odede Kideda as the EPZ chief executive in September 2018 and named George Makateto to replace him.

The appointment was however stopped by the courts after Mr Odeda sued against his dismissal.

Stephen Odua was then appointed Ceo in acting capacity and was replaced last year by Henry Obino who also took over on a temporary basis.

“The board recommends to the Cabinet Secretary, Ministry of Industrialisation Trade and Enterprise Development, the appointment of Ezekiel Owuor Otieno as the substantive ceo of the Export Processing Zones Authority having attained the highest average score of 85.5 percent which was above the threshold adopted by the board,” an internal memo by chairman Paul Gicheru reads.

EPZ authority had been riddled by scandals including a Sh1.3 billion tender inflation claims where 13 companies received hundreds of millions of shillings for goods and services that were never supplied, while other contracts were awarded to firms associated with board members and top government officials.

Top officials at the authority were also accused of significantly varying prices of projects, even after 90 per cent and 97 per cent of the contract sums had been paid for the works. Water meant for the firm was also sold to outsiders at the expense of manufacturers.

Source: Business Daily Africa

Parliament probes KNBS over delay in releasing key data

Parliament has launched an inquiry into the delay in release of data capturing performance of the economy and the jobs market by the Kenya National Bureau of Statistics (KNBS).

The National Assembly wants to know the reasons for the delay and non-release of official statistics including the Annual Economic Survey 2021, Leading Economic Indicators report, the Quarterly Gross Domestic Product (QGDP) report, Quarterly jobs report and other official statistics.

Speaker Justin Muturi has directed the Finance and National Planning Committee to file a response to the House within the next 14 days.

Mr Muturi sanctioned the inquiry following a request by Garissa Township MP Aden Duale who drew the attention of the House to the breach of the Statistics Act by the Kenya National Bureau of Statistics (KNBS).

Mr Duale said the KNBS had breached provisions of the Statistics Act and the Constitution by either delaying or refusing to release the reports.

Source: Business Daily Africa

UGANDA

Civil society urges govt to improve standards among SMEs

For decades, small businesses have grappled with high cost of doing business due to limited access to finance, which has now been exacerbated by Covid-19.

Micro Small and Medium Enterprises continue to lose out on multi-million deals due to their inability to comply with set standards.

While making a presentation to the Parliamentary Committee on Trade, Tourism and Industry, Ms Jane Nalunga, the Seatini executive director, urged Parliament to use its oversight role to push the government into mitigating compliance challenges that render a number of Uganda’s products uncompetitive.

The presentation, delivered under the theme: Uganda’s economy and Covid-19: Implications, lessons and proposals on a way forward” noted that the failure by the government to help small businesses to comply with set standards has cost the country dearly.

Source: The Monitor

Investment authority, UPDF in joint construction of industrial parks

Uganda Investment Authority (UIA) has partnered with the Uganda Peoples Defence Forces (UPDF) to construct 25 industrial parks across Uganda.

The partnership was formally announced on Thursday 05th August, 2021 in a meeting between UIA’s Director General Robert Mukiza and the Managing Director of National Enterprise Corporation (NEC), Lt Gen James Mugira. NEC is the business arm of the UPDF.

UIA, the primary investment promotion agency of the Government of Uganda, is mandated to build 25 regionally located industrial and business parks, including four science, technology and innovation parks (STIPs).

In its Strategic Plan 2020-2025 themed “Accelerating Domestic and Foreign Direct Investment for Sustainable Industrial Industrialisation”, UIA targets to create 400,000 jobs a year through industrial parks development. This is in line with Vision 2040 and the Third National Development Plan, which hinges on industrialisation.

Source: The Independent

Equity named Best Regional Bank in East Africa

Equity has been named the Best Regional Bank in East Africa at the 2021 African Banker Awards.

According to a statement, the award was conferred to the bank for its strong and consistent financial performance, its role in leading the disruption of Fintech innovations in banking and for its consistency in championing the socio-economic development of communities through its various social impact initiatives.

“We are honoured and humbled to receive this recognition. This is a testament to the success of our digital strategy and regional presence as we continue to drive financial integration, inclusive banking and to play a catalytic role in championing the socio-economic prosperity of the people of Africa,” said Equity Group Managing Director and CEO, Dr. James Mwangi after the award winners were announced.

Source: The Independent

TANZANIA

Tanzania’s FDI inflows hit $1bn mark in 2020

Regardless of the adverse impact of the Covid-19 pandemic on the economy, Tanzania’s Foreign Direct Investments (FDIs) reached the $1 billion mark in 2020, the highest in five years.

The country recorded a total of $1.01 billion in FDIs 2020, higher than the $991 million that it recorded in 2019, according to data from the World Investment Report 2021 by the United Nations Conference on Trade and Development (UNCTAD).

The last time the country reported over a billion-dollar FDI inflows was in 2015: $1.56 billion. Then the inflows dropped to $864 million in 2016.

In 2017 and 2018, the country recorded $938 million and $972 million in FDIs respectively, says the UNCTAD report. 

Year-on-year, Tanzania was reported to be the country that led with the highest increase of FDI inflows in the East African region, while other countries suffered adversely from the pandemic woes.

From 2019 to 2020, Tanzania recorded a 2.2 percent increase of FDI inflows, while Uganda, Kenya and Rwanda recorded a huge drop.

Source: The Citizen

Local vehicles inspection earns govt 4bn/-in three months

The government has collected 3.9bn/- since it started local vehicle inspections in April this year.

The Industry and Trade Minister Prof Kitila Mkumbo said in Dar es Salaam after touring one of the vehicle inspection centres near the Dar es Salaam port that under the former vehicle inspection system, the government would have received only 30 percent of the amount and 70 per cent gone to vehicle inspection agents.

The government decision to conduct vehicle inspection locally, using Tanzania Bureau of Standard (TBS), has earned 3.9bn/- in just a short period of the implementation of the new system.

“About 11, 179 vehicles have been inspected between April to August this year and 7,707 met the required standards and those below standards were sent to the local garages for maintenance,” he said.

Source: Daily News

TCB upgrades internet banking to unrivalled new heights

Tanzania Commercial Bank (TCB) has upgraded its internet banking service to uniquely new heights in the market by fully integrating the digital finance solution with all national payment systems.

Its Chief Executive Officer Sabasaba Moshingi said the revolutionary development is unrivalled in the industry and has been developed internally at no cost.

“The TCB Internet Banking solution was developed in-house at zero cost by our ICT experts and its edge over other online banking services is being fully integrated with all national payment systems,” Mr Moshingi said yesterday at its launch in Dar es Salaam.

Source: Daily News

Govt gives TPC, TTCL three months to end assets dispute

Tanzania Postal Corporation (TPC) and TTCL Corporate have been given three months to end the dispute over the distribution of assets owned by the corporations before the split.

The order was issued yesterday by Minister for Communication and Information Technology, Dr Faustine Ndugulile, at a working session of heads office, regional leaders and management to evaluate the organisation’s performance.

“We have already instructed them to sit down and split the assets. Those they failed to agree on to forward them to the ministry level and the registrar of the treasury to arrange for agreeable sharing mode,” said Dr Ndugulile.

The minister wants the matter to be resolved in September this year at a quarterly meeting in which they will discuss the achievements and plans for the 2021/22 budget.

Source: Daily News

25 years bond receives historical subscription

The 25 years Treasury bond has been heavily oversubscribed by slightly over four times, which is a historic amount since government securities were introduced to the market almost two decades ago.

The oversubscription echoed debt analysts’ prediction issued before the auction on Wednesday, while increased liquidity in the market is seen as an advantage as it helps the government to borrow cheaply.

The 25-year bond attracted 585.58bn/- against the central bank’s offered amount of 133bn/- showing the huge market appetite for portfolio investment venues.

Zan Securities said in the report yesterday that the auction result, on successful amount, offers a glimpse of the monetary direction that the BoT is taking to want banks channeling funds to the economy.

Source: Daily News

ETHIOPIA

Ethiopia to Reopen Second Telecom License Bid

Ethiopia will reopen bidding for its second telecoms operator license this month, said the regulatory agency of the Communication sector in the East African Nation.

In a statement, the Ethiopian Communications Authority (ECA) said the government is launching the bid to sell a second telecom license to international operators after seeing the encouraging outcome of the previous bidding process.

Ethiopia awarded one license to a consortium led by Kenya’s Safaricom in May, after accepting an offer of about $850 million and a commitment to invest ten times that amount over the next decade.

The consortium, namely the Global Partnership for Ethiopia, has, since then, established its local headquarters in Addis Ababa and is currently undertaking activities to launch its services pursuant to the License Agreement entered with the ECA.

Officials of the Authority said many described the liberalization process that awarded the first license as “highly successful”.

Source: Ethiopian Monitor

Sudan Asked to procure 1,000MW Electricity from Ethiopia, says EEP

Ethiopian Electric Power (EEP) on Thursday said Sudan has requested to purchase 1,000 megawatts of electric power from Ethiopia. 

The request came as Ethiopia prepares to start generating power with the two turbines of the Grand Ethiopian Renaissance Dam (GERD) within weeks. 

Sudan has made its interest to purchase 1,000 megawatts of power clear, said Andualem Sia, EEP’s Planning Executive Director, speaking to the state-run Ethiopian news agency.

The EEP, a state-owned electric producer, is currently in talks with experts of the neighboring nation, he added. 

EEP experts went to Khartoum last month and Sudanese experts would soon arrive in Ethiopia to continue the talks.

Sudan is not the only one that inquired about purchasing electric power. 

South Sudan, Kenya and other neighboring nations have also expressed interest in purchasing Electricity, said the planning expert at the EEP.

The construction of a transmission line capable of carrying 500 kilowatts of electricity to Kenya is nearly complete, he said.

Members of the Kenyan parliament will visit Ethiopia next week to discuss the issue, he added.

The 1,045km line, which interconnects at the Moyale common border between Ethiopia and Kenya, has the capacity to carry 2,000MW of electricity in either direction.

Source: Ethiopian Monitor